Home Market Regulator keeps HDFC AMCs IPO in abeyance

Regulator keeps HDFC AMCs IPO in abeyance


MUMBAI: Indias capital markets regulator has deferred giving approval to the initial share sale of HDFC Asset Management Company (AMC), citing certain undetailed past violations the authority needs to examine.

Without disclosing the nature of the alleged violations, the Securities and Exchange Board of India (Sebi) said that it has kept the IPO papers “in abeyance for examination of past violations,” according to the latest regulatory update as on April 27.

Nomura Financial Advisory and Securities (India), Kotak Mahindra Capital, Axis Capital, BofA Merrill Lynch, Citigroup Global Markets India, CLSA India, HDFC Bank, ICICI Securities, IIFL Holdings, JM Financial, JP Morgan India, and Morgan Stanley India have been appointed as managers to the proposed public issue, a local news agency reported late Friday.

Text messages and phone calls to HDFC Mutual Fund and Kotak Investment Bank, the lead banker for the proposed IPO, did not get any response until the publication of this report.

The fund house had filed preliminary papers with Sebi in March, seeking approval to sell shares for the first time locally.

HDFC AMC operates as a joint venture between Housing Development Finance Corporation (HDFC) and Standard Life Investments.

According to the draft prospectus, the proposed IPO offers up to 2.54 crore equity shares of the fund house through an offer for sale of 85.92 lakh shares by HDFC and up to 1.69 crore shares by Standard Life Investments.

HDFC AMC could be the second asset manager in the country to seek a listing after Reliance Nippon Life Asset Management.

HDFC AMC had average assets under management (AUM) of ₹3lakh crore at the end of March 2018. It has 200 branches and more than 1,000 employees and 55,000 distribution partners across banks, national distributors and independent financial advisors.

Assets managed by the Indian mutual fund industry have increased from ₹18.58 lakh crore in March 2017 to ₹22.71 lakh crore in March 2018, translating into a growth of 22.22%.

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